Victoria’s Secret, Delta Caught in Translators’ Dispute

By Karen Gullo and Pamela MacLean -
Oct 31, 2013

MotionPoint Corp., a maker of
technology that translates business websites into foreign
languages for customers such as Victoria’s Secret Stores LLC and
Delta Air Lines Inc. (DAL), asked a judge not to block sales of its
core product in a patent lawsuit brought by a rival.

A federal jury in Oakland, California, found in July that
closely held MotionPoint, whose customers also include the U.S.
Centers for Disease Control, directly infringed a patent held by
TransPerfect Global Inc. and should pay $1 million in damages.
New York-based TransPerfect, whose customers include Home Depot
Inc. (HD) and American Airlines Inc., is seeking a permanent
injunction barring the sale or use of MotionPoint technology
that directly or indirectly infringes the patent.

MotionPoint, which provides translation services for more
than 1,800 web sites, said in a court filing that a broad
injunction could potentially deny millions of foreign language
speakers access to translated versions of its customers’
websites.

“I would not enjoin your entire system,” U.S. District
Judge Claudia Wilken said at a hearing today. “What I would
enjoin is the infringing portion. I think it is the kind of case
that would involve an injunction.”

Wilken ordered both companies to file arguments about what
an injunction should include and enter mediation to try to
settle the dispute. She didn’t rule on whether to grant an
injunction.

Head-to-Head

The two companies have competed head-to-head for customers,
with closely held TransPerfect losing clients to MotionPoint and
at times lowering its prices as much as 20 percent to compete,
Michael Eisenberg, TransPerfect’s lawyer, said in a court
filing.

“TransPerfect would risk losing potential new customers
for its entire range of products and services, which is a
recognized harm found to support an injunction,’ Eisenberg said
in the filing.

If an injunction isn’t granted, TransPerfect may seek a
running royalty rate of more than 4 percent of sales of
infringing technologies, he said.

‘‘We are not seeking an injunction of what they are not
infringing,” Douglas Lumish, an attorney for TransPerfect, said
during the hearing. “We would be happy to negotiate it with
them.”

Foreign Language

An injunction targeting MotionPoint services on customer
websites would “deny hundreds of thousands, if not millions, of
foreign language speakers access to translated versions of
websites,” Matt Robson, MotionPoint’s attorney, said in a court
filing.

“The harm to the public that would result from
TransPerfect’s overreaching injunction is simply not warranted
on the facts of this case,” Robson said in the filing.

“While we want the infringement to stop, I don’t forsee
something where all of a sudden tons of customer websites come
down with no period to cure” the infringement, Phil Shawe, a
founder and chief executive officer of TransPerfect, said in a
phone interview.

The jury found that TransPerfect didn’t prove that Coconut
Creek, Florida-based MotionPoint induced others to infringe the
patent. The jury found that only the MotionPoint product used to
translate its own website infringed TransPerfect’s patent and
MotionPoint has already implemented a non-infringing alternative
on its website, Robson said.

“MotionPoint will diligently pursue all of its post-trial
rights, including appeal, at the appropriate time,” MotionPoint
said in a statement yesterday.

The case is TransPerfect Global Inc. v. MotionPoint Corp.,
10-cv-02950, U.S. District Court, Northern District of
California (Oakland).

To contact the reporter on this story:
Karen Gullo in federal court in San Francisco at kgullo@bloomberg.net
Pam MacLean in federal court in Oakland at
pmaclean@pacbell.net